What is the company cost of equity

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Reference no: EM132058241

1. The Down and Out Co. just issued a dividend of $2.46 per share on its common stock. The company is expected to maintain a constant 7 percent growth rate in its dividends indefinitely. If the stock sells for $30 a share, what is the company's cost of equity? (Do not round your intermediate calculations.)

2. The CPI for this year was reported at 162.65. If inflation was 3.0 percent, what must the CPI have been last year? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

3. Assume that the Federal Reserve injects $3.5 billion into the financial system. If the reserve requirement is 16 percent, what is the maximum increase in money supply (in billions)?

Reference no: EM132058241

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